Wednesday, July 28, 2010

Power's Impact on Behavior

For CPG companies such as P&G and Unilever, whose shopper is mostly a woman, the concept of empowerment to purchase for the household is an important topic. Also, retailers large and small look at the buying "power" of the geo- and demo- graphics to price in their locale, for example. So, what is the impact of "power" on the individual.

Here are a few strategic insights from the work of Adam Galinsky, Kellogg School of Management at Northwestern University (details here) and Joris Lammers, Tilburg University (details here) in their work "Illegitimacy Moderates the Effects of Power on Approach", download here.

"“Power activates a person’s behavioral approach system and underlies our motivation to act, while powerlessness activates our behavioral inhibition system to restrict action and risk-taking,” said Galinsky.

“But, in illegitimate power scenarios, the powerless are more likely to act without direction in an attempt to change the situation, and the powerful may inhibit their actions for fear of losing their undeserved seat at the top.”"

Another study from them published in the Psychological Science here, "Power Increases Hypocrisy, Moralizing in Reasoning, Immorality in Behavior" sheds light on a few interesting conclusions. Following are excerpts from a review in the Economist:

"...powerful people who have been caught out often show little sign of contrition. It is not just that they abuse the system; they also seem to feel entitled to abuse it."

Dr. Lammers and Dr. Galinsky introduce a new term "hypercrisy":

"...an intriguing characteristic emerged among participants in high-power states who felt they did not deserve their elevated positions. These people showed a similar tendency to that found in low-power individuals—to be harsh on themselves and less harsh on others—but the effect was considerably more dramatic. They felt that others warranted a lenient 6.0 on the morality scale when stealing a bike but assigned a highly immoral 3.9 if they took it themselves."

The research linked above and the Economist's conclusion paint a bleak picture though:

"Perhaps the lesson, then, is that corruption and hypocrisy are the price that societies pay for being led by alpha males (and, in some cases, alpha females). The alternative, though cleaner, is leadership by wimps."